Reading Matching
Read the passage and match the details (1-8) with the paragraphs (A-E). Some letters are used more than once.
A. When you're trying to get a new venture started, friends and family funding is often the first place you turn to raise some capital. In essence, friends and family investors are a form of crowdfunding. You might take small amounts of money from several family members or close friends, to raise a more significant overall sum. These investors may be willing to put money into your business venture on an interest-free basis. Alternatively. you might draw up a friends and family investment agreement that promises interest, an equity stake or some other form of reward for lending you the money you need.
B. Friends and family funding often takes place on a much less formal basis than bank business loans, angel investments or even peer-to-peer lending from strangers. It's a way to raise money at a very early stage in your business. You might not yet have a complete business plan or any proof of value, such as initial orders for stock. Most friends and family investors will be willing to put their trust in you to deliver on your business plan, no matter how concrete or vague it may currently be.
C. There are risks involved with any investment, but in family and friend investments, the close bond you have with your new financial supporters can add to the stress if your venture does not succeed quickly. You might feel more of a responsibility to give your loved ones a positive return on their investment, or at least to pay them back the money they lent you whether with or without interest. In the worst cases, if your business fails, you risk not only your personal savings but also potentially a large amount of money from many of the people who are closest to you.
D. Whereas a professional investor will be able to absorb this risk by spreading their
investments across multiple different ventures, it is more likely that family and friend
investors have put all of their money into your project. That means that if you fail, you and a lot of the people around you could be left out of pocket by a large amount, which can put a lot of strain on personal relationships and damage your quality of life too.E. Although it's often quite informal, family and friend funding falls into a few common types. Two of the main kinds are business loans and equity funding. You promise you will repay the loan with interest or give an equity stake to your friend or family member as a thank you for their support. In the very early stages of your business, it can be hard to
know how much to promise. An equity stake is a scalable way to offer your supporters a
fair share of any future profits, but you might not want to give away too much of your
company as early as the pre-seed funding phase.
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Match question 1/1
A. Paragraph A
B. Paragraph B
C. Paragraph C
D. Paragraph D
E. Paragraph E
Number(1,2,3...)
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Letter (A, B, ACD....)
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